Lane keeping control of the single track vehicle model with linear tire characteristics is analyzed in the presence of time delay. In order to compensate time delay, the predictor control approach called finite spectrum assignment is applied. This controller uses an internal model of the plant to predict current system states in spite of the time delay. The predictions are based on a simplified version of the vehicle model, neglecting tire dynamics. The predictive control approach is compared with traditional feedback control using analytically derived stability maps and numerical simulations. Robustness to parameter mismatches and numerical issues related to the implementation of the control law are also analyzed.